Favouritism Breeds Self-Interest : An Experimental Study of Procedural and Outcome Fairness

We investigate the effect of different procedures for assigning decision-making roles for the distribution of collective resources using a dictator game. Three role allocation procedures are tested, namely random, meritocratic, and favouritism. We contribute to the literature by employing an unfair procedure for the first time and by examining the effect of providing different endowment to recipients on distributional choices across the three allocation procedures. Our study design provides insight into the relationship between procedural and outcome fairness. Findings show that individual choices motivated by outcome fairness are strongly dependent on the degree of procedural fairness. Dictators who obtain their role through unfair mechanisms transfer significantly less money to recipients than dictators exposed to fair procedures